LIC Housing Fin to raise Rs 1,200 cr via NCDs

TNNSep 15, 2003, 10.57pm IST

CHENNAI: LIC Housing Finance (LICHFL), a subsidiary of Life Insurance Corporation, is likely to raise Rs 1,200 crore by way of non-convertible debentures in a phased manner this year. However, it is yet to decide on the timing and quantum of funds.

Mr SC Jain, CEO, LICHFL said the company had already raised Rs 900 crore of this year's target of Rs 2,500 crore. "For the remaining amount, we have a number of options to choose from: term loans from banks, commercial papers, securitisation and funding from multilateral financial institutions," he said. It has received ratings to raise Rs 1,200 crore through NCDs, he added.

He informed media persons in Chennai today, through NCDs it had raised Rs 285 crore so far. It has also picked up Rs 250 crore through external commercial borrowings and Rs 200 crore by securitising a part of its loan portfolio to LIC.

"ECB route was cheaper at about 4% then. However, the rates have gone up since. The government too does not encourage ECBs these days, thanks to its huge forex reserves," he said, adding that the company would focus on the other means of funding, rather than on ECBs.

Mr Jain was in Chennai to inaugurate the new premises of southern regional office and to launch a toll-free helpline facility for LICHFL customers. He said, the region contributed 28% of the company's business, inspite of operating from a home-loan market that was not as vibrant as Mumbai or Pune.

"The South could achieve this, thanks to its strong marketing network and we are in the process of replicating this model elsewhere in the country," he said. To cater to NRIs from Kerala and Tamil Nadu, who are now in west Asia, the company plans to set up representative offices in Muscat, Sharjah and Abudhabi. It already has an office at Dubai, he said.

He said, LICHFL helpline would offer advice on home loans, including valuations, tax and legal issues, he added.